Chronicle Year Book 2018

India is the 7th largest country by area and 2nd largest by population. It is the 12th largest economy at market exchange rate and 4th largest by PPP. Yet, India is far away from the development of the neighbourhood nation, i.e., China.

The exclusion in terms of low agricultural growth, low quality employment growth, low human development, rural-urban divides, gender and social inequalities, and regional disparities, etc. are the problems for the nation. Studies estimated that, the cost of corruption in India amounts to over 10% of GDP. Corruption is one of the ills that prevent inclusive growth. Although child labour has been banned by the law in India and there are stringent provisions to deter this inhuman practice, still, many children in India are unaware of education as their lives are spoiled to labour work. Literacy levels have to rise to provide the skilled workforce required for higher growth.

Why We Need Inclusive Growth?

Inclusive growth is important for very salient reasons:

• For ethical considerations of equity and fairness, growth must be shared and should be inclusive across different segments of populations and regions. Economic and other shocks hurt the poor and the vulnerable most, and growth that results in high disparity is unacceptable.
• Growth with persisting inequalities within a country may endanger social peace, force poor and unemployed people into criminal activities, make women more vulnerable to prostitution, force children into undesirable labor, and further weaken other disadvantaged and vulnerable sections of population—resulting in a waste of vast human capital that could otherwise be used productively in creating economic outputs for sustainable growth.
• Continued inequalities in outcomes and access to opportunities in a country may result in civil unrest and violent backlash from people who are continually deprived, derailing a sustainable growth process. This may create political unrest and disrupt the social fabric and national integration, undermining the potential for long-term, sustained growth.

Despite making remarkable progress in bringing down poverty from about 70% at independence to about 22% in 2011-12 (Tendulkar Committee), it can safely be said that “wiping every tear from every eye” is about a lot more than being able to imbibe a few calories. And the Mahatma understood that better, deeper, and earlier than all the Marxists, market messiahs, materialists and behaviouralists. He intuited that it is also about dignity, invulnerability, self-control and freedom, and mental and psychological unburdening. From that perspective, Nehru’s exhortation that “so long as there are tears and suffering, so long our work will not be over” is very much true nearly 70 years after independence.

Universal Basic Income is a radical and compelling paradigm shift in thinking about both social justice and a productive economy. A universal basic income is, like many rights, unconditional and universal: it requires that every person should have a right to a basic income to cover their needs, just by virtue of being citizens.

The 1931 Census, for the first time, systematically categorized certain castes as ‘depressed classes’. Thereafter, the Government of India Act, 1935, for the first time, provided for notification of socially disadvantaged castes as ‘Scheduled Castes’, and a list of such castes was accordingly notified in the Government of India (Scheduled Castes) Order, 1936. The elections to provincial assemblies in British administered areas held in 1937 under the above Act, provided seats reserved exclusively for Scheduled Caste candidates.

The Constitution of India abolished “untouchability” and provided several special safeguards for the Scheduled Castes, so as to ensure that they are able to attain equality with the other social groups in the shortest possible time. These safeguards enabled reservation in elections to the Lok Sabha and State Legislative Assemblies, and reservation in Government jobs.

The Ministry of Social Justice & Empowerment (SJ&E) is the nodal Ministry to oversee the development and empowerment of the Scheduled Castes. Though the primary responsibility for this rests with various Central Ministries and State Governments/Union Territory Administrations, the Ministry of SJ&E has been assigned nodal responsibility in this regard.

Article 366 (25) of the Constitution of India refers to Scheduled Tribes as those communities, who are scheduled in accordance with Article 342 of the Constitution. This Article says that only those communities who have been declared as such by the President through an initial public notification or through a subsequent amending Act of Parliament will be considered to be Scheduled Tribes.

The list of Scheduled Tribes is State/UT specific and a community declared as a Scheduled Tribe in a State need not be so in another State/UT.The essential characteristics, first laid down by the Lokur Committee, for a community to be identified as Scheduled Tribes are:

• Indications of primitive traits
• Distinctive culture
• Shyness of contact with the community at large
• Geographical isolation
• Backwardness

These criteria are not spelt out in the Constitution but have become well established and accepted. It took into account the definitions in the 1931 Census, the reports of the first Backward Classes Commission (Kalelkar) 1955, the Advisory Committee on Revision of SC/ST lists (Lokur Committee) 1965 and the Joint Committee of Parliament on the Scheduled Castes and Scheduled Tribes Orders (Amendment) Bill, 1967 (Chanda Committee) 1969.

The Indian Constitution is committed to the ideas of equality and protection and assurance of rights of minorities, which cover six religious communities, viz., Muslims, Christians, Sikhs, Buddhists and Zoroastrians (Parsis) and Jains. These communities accounted for 18.4% of the population in 2001. The Centre in 2014 accorded minority status to Jains. Jains, according to the 2001 Census, make up 0.4 per cent of the country’s population.

The largest proportion was Muslims (13.4%), followed by Christians (2.3%), Sikh (1.9%), Buddhists (0.8%) and Zoroastrians (0.0069%). Depending on their distribution across States, these communities may actually be a ‘majority’ in some States, for example Muslims are in majority in the Union Territory of Lakshadweep and in the State of Jammu and Kashmir as are Christians in Nagaland (90%), Mizoram (87%) and Meghalaya (70.03%) and Sikhs in Punjab (60%).

While India has experienced accelerated growth and development in recent years, not all religious communities and social groups (henceforth socio-religious communities—SRCs) have shared equally the benefits of the growth process. Among these, the Muslims, the largest minority in the country, are seriously lagging behind on all human development indices. There is also widespread disparity within different SRCs, supporting the view that each SRC is a differentiated category with multiple identities and different socio-political and economic aspirations.

• Six notified minorities under National Commission for Minorities Act, 1992 are: Muslims, Christians, Sikhs, Buddhists, Parsis (Zoroastrians), Jains. Notified minorities constitute about 19% population of the country.
• The Ministry of Minority Affairs was carved out of Ministry of Social Justice & Empowerment and created on January 29th, 2006 to ensure a more focussed approach towards welfare measures relating to the notified minority communities.

The Second Backward Classes Commission (commonly known as Mandal Commission), constituted under Article 340, submitted its Report in 1980. In the light of this Report, the Government of India had issued an order providing 27% reservation in Central Government posts for persons belonging to the Socially and Economically Backward Classes, (also referred to as “Other Backward Classes” or OBCs) in 1990.

Several writ petitions were filed in the Supreme Court challenging this Order. These were disposed of by the Supreme Court in 1992, by a majority judgment, which is commonly known as the judgment in the Indra Sawhney case. In this judgment, the Court upheld 27% reservation for OBCs in civil posts and services under the Union of India, subject to exclusion of the “Creamy Layer”.

The Government of India in 1993 reserved 27% of vacancies in Civil Posts and Services under the Central Government, to be filled through direct recruitment in favour of the Other Backward Classes (OBCs).

With the amendment of Article 15 of the Constitution in January, 2006 and the enactment of the Central Educational Institutions (Reservation in Admissions) Act in January, 2007, listing of other backward classes has become relevant for admission in Central Educational Institutions also. Under this Act, OBC students are entitled to 27% reservation in Central Educational Institutions in a phased manner, over a period of three years commencing from the academic session 2008-09.

The genesis of the problems of Transgender persons in India lie in the stigma and discrimination they face in the society, resulting in their exclusion from socio-economic-political spectrum. They are one among the marginalized sections of the society. The solution of their problems will, therefore, require concerted efforts to mainstream them and adoption of an inclusive approach in all spheres of life. The transgender community is one of the disadvantaged groups and without their inclusion in the development efforts; the objective of inclusive growth cannot be fully realised.

The reason society has been treating transgender people the way it does, is because they do not fit the conventions created by the former. In the media that we come across every day, be it in films or television, they are not included much. But this practice is slowly changing as documentary and film-makers are taking up their stories and focusing upon them in their artwork.

All human beings are born free and are equal and ought to be entitled to enjoyment of human rights with dignity and without discrimination on the basis of sexual orientation or gender identity. Also, everyone is entitled to equality before the law. Transgender people are also part of society and have equal rights which are available to others. However, the discrimination based on their class and gender makes the transgender community one of the most dis-empowered and deprived groups in Indian society.

Gender equality has long been recognized both as a human right and a core development goal. In addition, discrimination against women and girls impairs progress in all other areas of development. A growing body of evidence shows that gender inequalities can make the process of development less inclusive by weakening the ability of household members to care for each other or to engage in productive activities. For example, gender discrepancies in education can make the labor force less effective, undermining the economy’s growth potential. At the same time, structural changes that accompany the development process—as a result of technological change, international competition, or policy liberalization—can substantially alter the constraints that women and men face when they approach new economic opportunities. The extent to which these forces lead to greater gender parity or greater divisions will influence the extent of inclusiveness of future growth.

Underling the importance of gender equality, UNFPA’s “State of the World Population 2014” says, if girls and young women continue to face gender discrimination, early marriage and barriers to sexual and reproductive health and rights, resilience to rapid social and environmental change will be further undermined”.

Equity is enshrined in the UN Charter and the “promotion of gender equality and the empowerment of women” is the third Millennium Development Goal. Several major international agreements have urged governments to take steps to ensure that both women and men enjoy equal rights, opportunities and responsibilities – such as the Nairobi Forward Looking Strategy for Advancement of Women (1985) and the Beijing Platform for Action (1995).

According to UNICEF, inclusive education is a process that involves the transformation of schools and other centres of learning to cater for all children – including boys and girls, students from ethnic and linguistic minorities, rural populations, those affected by HIV and AIDS, and those with disabilities and difficulties in learning and to provide learning opportunities for all youth and adults as well. Its aim is to eliminate exclusion that is a consequence of negative attitudes and a lack of response to diversity in race, economic status, social class, ethnicity, language, religion, gender, sexual orientation and ability.

Education takes place in many contexts, both formal and non-formal, and within families and the wider community. Consequently, inclusive education is not a marginal issue but is central to the achievement of high quality education for all learners and the development of more inclusive societies. Inclusive education is essential to achieve social equity and is a constituent element of lifelong learning.

In 2017-18, over Rs 1,50,000 crore, or 7.6% of the government’s total expenditure has been allocated for providing food subsidy under the Targeted Public Distribution System (TPDS).This allocation is made to the Department of Food and Public Distribution under the Ministry of Consumer Affairs.

Food subsidy has been the largest component of the Department’s expenditure (94% in 2017-18), and has increased six-fold over the past 10 years.This subsidy is used for the implementation of the National Food Security Act, 2013 (NFSA), which provides subsidised food grains (wheat and rice) to 80 crore people in the country. The NFSA seeks to ensure improved nutritional intake for people in the country.

Growth is not the sole objective of economic policy. It is necessary to ensure that the benefits of growth accrue to all sections of the society. Eradication of poverty is thus an important objective. The widening gap between rich and poor worldwide is a major threat to global security and economic integration. Poverty is a vicious circle, being both the cause and effect of the lack of opportunities that exist for the poor to help themselves.

Economic growth will not reduce poverty, improve equality and produce jobs unless it is inclusive. Inclusive growth is also essential for the achievement of the Millennium Development Goals (MDGs). The globalization process, when properly managed, becomes an important ingredient for inclusive growth.

Financial inclusion broadens the resource base of the financial system by developing a culture of savings among large segment of rural population and plays its own role in the process of economic development. Further, by bringing low income groups within the perimeter of formal banking sector; financial inclusion protects their financial wealth and other resources in exigent circumstances. Financial inclusion also mitigates the exploitation of vulnerable sections by the usurious money lenders by facilitating easy access to formal credit.

Access to a transaction account is a first step toward broader financial inclusion since it allows people to store money, and send and receive payments. A transaction account can also serve as a gateway to other financial services, which is why ensuring that people worldwide can have access to a transaction account is the focus of the World Bank Group’s Universal Financial Access 2020 initiative.

Financial access facilitates day-to-day living, and helps families and businesses plan for everything from long-term goals to unexpected emergencies. As accountholders, people are more likely to use other financial services, such as credit and insurance, to start and expand businesses, invest in education or health, manage risk, and weather financial shocks, which can improve the overall quality of their lives.

India is a 1.3-billion-person anomaly. As a whole, the country is doing exceptionally well. It is the fastest growing major economy in the world, and is catching up with wealthier nations with impressive speed. Yet over the last several decades, defying economic theory, the Indian states with the strongest development are those that were already best off.

The Constitution of India through its Preamble, inter-alia seeks to secure to all its citizens; Justice, social, economic and political; Liberty of thought, expression, belief, faith and worship; Equality of status and of opportunity.Part-III of the Constitution provides for a set of six Fundamental Rights to all the citizens (and in a few cases to non-citizens also). These include – Right to Equality; Right to Freedom; Right against Exploitation; Right to Freedom of Religion; Cultural and Educational Rights and Right to Constitutional Remedies. All these rights are also available to the Persons with Disabilities even though no specific mention of such persons appear in this Part of the Constitution.

Historically, migration of people for work and education has been a phenomenon that accompanies the structural transformation of economies, and has paved the way for the release of “surplus labour” from relatively low-productive agricultural activities to sectors enjoying higher productivity. The resulting remittance flows increase household spending in the receiving regions and further the economic development of less-developed regions.

The Economic Survey 2017 has brought in new evidence to indicate that Indians are much more mobile than it was generally believed. The 2011 Census, rail traffic data and changes in population in different age categories show that migration is much larger than what has been argued by using traditional sources of data like the National Sample Survey (NSS) and the population census. More importantly, there seems to have been an upsurge in mobility for economic reasons in the recent decade across states.

Traditionally, inter-state migrants have been only a small percentage of the total migrants in India. Results from the 2011 Census are yet to be released providing data on this migration stream. However, as per the 2001 Census, inter-state migrants constitute only 13% of total migrants. The last NSS on migration for 2007-08 shows that inter-state migrants were 11.5%, up from 10.3% in 1999-2000. Even if one uses the census percentage figure, the number of inter-state migrants would be around 18.5 million in 2011, averaging less than two million a year.

General improvement in the health care facilities over the years has resulted in continuing increase in proportion of population of senior citizens. Continuous increase in life expectancy means that more people are now living longer. Therefore, senior citizens in the country are no longer a homogenous group. The number of senior citizens of 80 years and above has been increasing. The needs of the old are different from those senior citizens in the age group of 60 years and above. Special attention needs to be given to this category of senior citizens.

As per 2011 Census, total population of Senior Citizens (people aged 60 years and above) is 10.38 crore, of which population of males and females was 5.11 crore and 5.27 crore respectively.

The total number of child labour in the country has reduced by 65% as per the Census 2011. As per the 2001 Census, the child labourers were mostly working in paan (betel), bidi, construction, domestic work, spinning and weaving sector. However sectoral dis-aggregated data on child labour from 2011 Census was not available.

Economic Survey reviews the developments in the Indian economy over the previous 12 months, summarizes the performance on major development programs, and highlights the policy initiatives of the government and the prospects of the economy in the short to medium term.The Department of Economic Affairs, Finance Ministry of India presents the Economic Survey in the parliament every year, just before the Union Budget. It is the ministry’s view on the annual economic development of the country. The 2017-18 Pink-Color Economic Survey highlighted gender issues.

Economic planning is the making of major economic decisions— by the conscious decision of a determinate authority, on the basis of a comprehensive survey of a country’s existing and potential resources and a careful study of the needs of the people. The basis socioeconomic problems in India like poverty, unemployment, stagnation in agricultural and industrial production and inequality in the distribution of income and wealth can be solved with proper economic planning.

Economic planning is a resource allocation mechanism that is contrasted with the market mechanism. As a coordinating mechanism for socialist economics, economic planning substitutes factor markets and is defined as a direct allocation of resources. This is contrasted with the indirect allocation mechanism of a market economy. There are various types that economic planning procedures and forms planning can take.

The level of centralization in decision-making in planning depends on the specific type of planning mechanism employed. As such, one can distinguish between centralized planning and decentralized planning. An economy primarily based on central planning is referred to as a planned economy.

In a centrally planned economy the allocation of resources is determined by a comprehensive plan of production which specifies output requirements. Planning may also take the form of directive planning or indicative planning.

Most modern economies are mixed economies incorporating various degrees of markets and planning. A distinction can be made between physical planning (as in pure socialism) and financial planning (as practiced by governments and private firms in capitalism). Physical planning involves economic planning and coordination conducted in terms of disaggregated physical units, whereas financial planning involves plans formulated in terms of financial units.

The Union Budget of India, is the annual financial statement that follows Article 112 of the Constitution of India. The budget, which is presented by means of the Finance bill and the Appropriation bill has to be passed by both the Houses before it can come into effect from April 1, the start of India’s financial year.

There is a constitutional requirement in India (Article 112) to present before the Parliament a statement of estimated receipts and expenditures of the government in respect of every financial year which runs from 1 April to 31 March. This ‘Annual Financial Statement’ constitutes the main budget document. Further, the budget must distinguish expenditure on the revenue account from other expenditures.

Therefore, the budget comprises:

1. Revenue Budget and the
2. Capital Budget

India announced a $33 billion recapitalization plan in October last year to tackle one of the highest stressed loan ratios in the world. But, the latest scandals have raised concerns that most of the capital to be pumped in will go into providing for more losses towards soured loans, leaving very little for fresh lending. That bodes badly for the economy which is already estimated to have slowed to a four-year low in 2018.

Indian banking system consists of “non scheduled banks” and “scheduled banks”. Non scheduled banks refer to those that are not included in the second schedule of the Banking Regulation Act of 1965 and thus do not satisfy the conditions laid down by that schedule.

Scheduled banks refer to those that are included in the Second Schedule of Banking Regulation Act of 1965 and thus satisfy the following conditions: a bank must:

1. have paid up capital and reserve of not less than Rs. 5 lakh and
2. satisfy the Reserve Bank of India (RBI) that its affairs are not conducted in a manner detrimental to the interest of its deposits.

Scheduled banks consists of “scheduled commercial banks” and scheduled cooperative banks. The former are further divided into four categories: (1) public sector banks; (2) private sector banks (that are further classified as “Old Private Sector Banks” and “New Private Sector Banks” that emerged after 1991); (3) foreign banks in India, and (4) regional rural banks (that operate exclusively in rural areas to provide credit and other facilities to small and marginal farmers, agricultural workers and small entrepreneurs). These scheduled commercial banks except foreign banks are registered in India under the Companies Act.

The Indian banking system consists of 27 public sector banks, 26 private sector banks, 46 foreign banks, 56 regional rural banks, 1,574 urban cooperative banks and 93,913 rural cooperative banks, in addition to cooperative credit institutions. Public-sector banks control more than 70 per cent of the banking system assets, thereby leaving a comparatively smaller share for its private peers. Banks are also encouraging their customers to manage their finances using mobile phones.

The Reserve Bank gets its role in currency management from the Reserve Bank of India Act, 1934. The Government, on the advice of the Reserve Bank, decides on various denominations of banknotes to be issued. The Reserve Bank also co-ordinates with the Government in the designing of banknotes, including the security features.

Demonetisation was the first step towards going cashless. A digital, cashless economy has several benefits in terms of transparency, security, efficiency, and convenience. Moving towards a digital economy will save the exchequer the massive cost of printing large numbers of banknotes. A digital economy would also obviate the problem of counterfeit currency, which caused substantial economic loss before demonetisation.

Cashless economy can be defined as a situation in which the flow of cash within an economy is non-existent and all transactions have to be through electronic channels such as direct debit, credit and debit cards, electronic clearing, and payment systems such as Immediate Payment Service (IMPS), National Electronic Funds Transfer and Real Time Gross Settlement in India.

India uses too much cash for transactions. The ratio of cash to gross domestic product is one of the highest in the world 12.42% in 2014, compared with 9.47% in China or 4% in Brazil. The number of currency notes in circulation is also far higher than in other large economies; India had 76.47 billion currency notes in circulation in 2012-13 compared with 34.5 billion in the US.

India continues to be driven by the use of cash; less than 5% of all payments happen electronically. This is due to lack of access to banking for a large part of the population as well as cash being the only means available for many. Large and small transactions continue to be carried out in cash. Even those who can use electronic transfers, use cash.

Relations between India and Pakistan have remained less than normal ever since the partition of the country in 1947. The two countries have fought wars in 1948, 1965, 1971 and later there was Kargil in 1999. The war of terror against India from across the border continues unabated. Sporadic efforts have been made towards normalization of relations but most of the time it has been a case of back to square one.

Inflation is a rise in the general level of prices of goods and services in an economy over a period of time. When the general price level rises, each unit of currency buys fewer goods and services. This implies that:

• The purchasing power of money gets eroded.
• There is a loss in real value of money as medium of exchange and unit account in the economy.
• Inflation has good as well as bad impacts for economy.

The government has taken several legislative, administrative and technological measures to eliminate corruption and black money. Amongst the legislative measures the principal ones are formulation a) Black Money (Undisclosed Foreign Income and Assets) Imposition Act, 2015 b) Benami Transactions (Prohibition) Amendment Act, 2016 c) Securities Laws (Amendment) Act, 2014 and d) the Specified Bank Notes (Cessation of Liabilities Act), 2017 etc.

An estimated $770 billion in black money entered India during 2005-2014, according to the US-based think tank Global Financial Integrity (GFI)’s report, titled Illicit Financial Flows to and from Developing Countries: 2005-2014.

Key Findings of The Report

• Nearly $165 billion in illicit money exited the country during the same period.
• During 2014 alone, about $101 billion black money entered the country while $23 billion exited.
• Illicit financial flows (IFFs) from developing and emerging economies kept pace at nearly $1 trillion in 2014.
• Total illicit financial outflow was 3% (about $165 billion) of India’s total trade of $5500.744 billion between 2005-2014.

The new economic policy initiated in July 1991 clearly indicated that PSUs, which were established as pillars of growth, had shown a very negative rate of return on capital employed. Inefficient PSUs had become and were continuing to be a drag on the Government’s resources. Hence, the Government took a view that it should move out of non-core businesses, especially the ones where the private sector had now entered in a significant way. Finally, disinvestment was also seen by the Government to raise funds for meeting general/specific needs. In this direction, the Government adopted the ‘Disinvestment Policy’.

At the very basic level, disinvestment can be explained as follows:

“Investment refers to the conversion of money or cash into securities, debentures, bonds or any other claims on money. As follows, disinvestment involves the conversion of money claims or securities into money or cash.”

Disinvestment can also be defined as the action of an organization (or government) selling or liquidating an asset or subsidiary. It is also referred to as ‘divestment’ or ‘divestiture.’ In most contexts, disinvestment typically refers to sale from the government, partly or fully, of a government-owned enterprise. It is done when a PSU start incurring the loss of exchequer.

A company or a government organization will typically disinvest an asset either as a strategic move for the company, or for raising resources to meet general/specific needs. The DIPAM i.e. Department for Investment and Public Asset Management under Ministry of Finance is the nodal agency for disinvestment. The budget 2018-19 has set a goal of disinvestment target of Rs 80,000 crore.

Foreign trade consists of imports, exports and entrepot. The inflow of goods in a country is called import trade whereas outflow of goods from a country is called export trade. Many times goods are imported for the purpose of re-export after some processing operations. This is called entrepot trade.

Agriculture plays a vital role in India’s economy. Over 58 per cent of the rural households depend on agriculture as their principal means of livelihood. The share of primary sectors (including agriculture, livestock, forestry and fishery) is estimated to be 20.4 per cent of the Gross Value Added (GVA) during 2016-17 at current prices. GVA from the sector is estimated to have grown at 3 per cent in FY18. India is expected to achieve the ambitious goal of doubling farm income by 2022.

The agriculture sector employs nearly half of the workforce in the country. However, it contributes to 17.5% of the GDP (at current prices in 2015-16). Over the past few decades, the manufacturing and services sectors have increasingly contributed to the growth of the economy, while the agriculture sector’s contribution has decreased from more than 50% of GDP in the 1950s to 15.4% in 2015-16 (at constant prices).

Cities are regarded as ‘engines of growth’ for economies. To meet this, the Govt. has started Smart Cities Mission to improve the ease of living particularly for the poor, women, elderly and differently abled people.

Cities are regarded as “engines of growth” for economies. The confluence of capital, people and space in cities unleashes the benefits of agglomeration, creating a fertile environment for innovation of ideas, technologies and processes which produce huge economic returns. Cities in India generate two-third of national GDP, 90% of tax revenues and the majority of formal sector jobs, with just a third of the country’s population. Despite being centers of opportunity, the cities of India bring with them a host of environmental and infrastructural challenges, from pollution to lack of civic amenities like drinking water, sewage, housing and electricity, which disproportionately impacts the more vulnerable poor population. For addressing these issues, the Government has taken various steps to improve urban infrastructure like Swachh Bharat Mission (SBM, urban), Atal Mission for Rejuvenation and Urban Transformation (AMRUT), Heritage City Development and Augmentation Yojana (HRIDAY) and Smart Cities Mission.

Infrastructure sector is a key driver for the Indian economy. The sector is highly responsible for propelling India’s overall development and enjoys intense focus from Government for initiating policies that would ensure time-bound creation of world class infrastructure in the country.

The Industrial sector in India, including construction, is an important contributor to the growth with the sector accounting for 31.1% of the total Gross Value Added (GVA) in 2016-17. A strong and a robust industrial and manufacturing sector helps in promoting domestic production, exports and employment, all of which can be catalysts for higher growtha in the economy.

Energy is one of the most critical components of infrastructure crucial for the economic growth and welfare of nations. The existence and development of adequate infrastructure is essential for sustained growth of the Indian economy.

The IEA defines energy security as “the uninterrupted availability of energy sources at an affordable price”. Energy security has many dimensions:

• Long-term energy security mainly deals with timely investments to supply energy in line with economic developments and sustainable environmental needs.
• Short-term energy security focuses on the ability of the energy system to react promptly to sudden changes within the supply-demand balance.

Lack of energy security is thus linked to the negative economic and social impacts of either physical unavailability of energy, or prices that are not competitive or are overly volatile.

Nuclear power is the fifth-largest source of electricity in India after coal, gas, hydroelectricity and wind power.India has signed civil nuclear agreements with 14 countries. India the only known country with nuclear weapons which is not a party to the Non-Proliferation Treaty (NPT) but is still allowed to carry out nuclear commerce with the rest of the world.

Nuclear is a clean, environment friendly base load source of power available 24X7. It also has huge potential which will ensure long term energy security of the country in a sustainable manner. Therefore nuclear energy is an important component of the country’s energy mix and is being pursued along with other sources of energy in an optimal manner.

Seventyyears since the constitution of the Atomic Energy Commission in 1948, the total installed capacity of nuclear power in India has reached 6,780 MWe, comprising 22 nuclear reactors.

The installed capacity is expected to increase gradually, to 22,480 MW (including PFBR, 500 MW being implemented by Bharatiya Nabhikiya Vidyut Nigam Limited [BHAVINI]) by 2031 on progressive completion of projects under construction and accorded administrative approval financial sanction by the Government of India.

The low installed capacity base of nuclear power in the country is mainly on account of the technology development in an international embargo regime that persisted from 1974 to 2008 and constraint of resources faced during the initial decades of the nuclear power programme, as it had to depend solely on budgetary support. The low share of nuclear power in the total installed capacity is on account of its low capacity base.

Bharatmala Project is one of the biggest highway construction projects in India in history that is aimed at building highways from Gujarat and Rajasthan, move to Punjab and then cover the entire string of Himalayan states - Jammu and Kashmir, Himachal Pradesh, Uttarakhand - and then portions of borders of Uttar Pradesh and Bihar alongside Terai, and move to West Bengal , Sikkim, Assam, Arunachal Pradesh, and right up to the Indo-Myanmar border in Manipur and Mizoram.

Bharatmala Pariyojana is a new umbrella program for the highways sector that focuses on optimizing efficiency of freight and passenger movement across the country by bridging critical infrastructure gaps through effective interventions like:

• Development of Economic Corridors
• Inter Corridors and Feeder Routes
• National Corridor Efficiency Improvement
• Border and International connectivity roads
• Coastal and Port connectivity roads and Green-field expressways

A total of around 24,800 km are proposed to be constructed in Phase I. In addition, Phase I also includes 10,000 km of balance road works under NHDP. Estimated outlay for Phase I is Rs 5,35,000 crore. The objective of the program is to achieve optimal resource allocation for a holistic highway development/improvement initiative.

India has a 7,500 km long coastline and 14,500 km of potentially navigable waterways. 12 major and 200 non-major ports located along the Western and Eastern coastlines have so far been responsible for 90% of India’s trade by volume. Over 1 billion tonnes of cargo was handled across Indian ports in Financial Year FY 2015-16.

The Centre, in March 2015, gave ‘in-principle’ approval for the concept and institutional framework of Sagarmala Project. The prime objective of the Sagarmala project is to promote port-led direct and indirect development and to provide infrastructure to transport goods to and from ports quickly, efficiently and cost-effectively. Therefore, the Sagarmala Project shall, inter alia, aim to develop access to new development regions with intermodal solutions and promotion of the optimum modal split, enhanced connectivity with main economic centres and beyond through expansion of rail, inland water, coastal and road services.

Indian Railways play the most economical mode of transport among the prevailing travel modes in India. It has emerged today as the main vehicle for socio-economic development of the country. Indian railway is one of the largest employment providers in India.

The share of Indian Railways in freight movement has been declining over a period of time primarily due to non-competitive tariff structure. While the passenger fare had remained more or less flat, the freight fare has increased sharply over the year.

Recent Initiatives

To make rail transportation attractive and arrest the declining trend of rail share, various initiatives were taken in 2016-17 which includes:

• Tariff rationalization
• Classification of new commodities
• New policy guideline for station to station rates
• Expansion of freight basket through containerization
• Withdrawal of dual freight policy for export of iron ore
• Rationalization of coal tariff
• Policy guidelines of Merry Go Round System
• Discount for loading of bagged consignment in open and flat wagons
• New delivery models like Roll-on Roll-off services
• Re-introduction of short lead concession and reduction in minimum distance for charge
• Digital payment for freight business
• Long Term Tariff Contract Policy (which provides tariff stability and attractive rebate in freight to customers)
• Liberalised Automatic Freight Rebate scheme for traffic loaded in empty flow directions. etc.

Apart from above initiatives, the Government has emphasized on railways infrastructure development. The pace of commissioning Broad Gauge lines and completion of electrification have been accelerated during the last three years.

‘Station Redevelopment’ is the biggest non-fare revenue generating project for redeveloping railways stations in the country and has been included in the Harmonized List of Infrastructure Subsectors.

India’s aviation industry is largely untapped with huge growth opportunities, considering that air transport is still expensive for majority of the country’s population, of which nearly 40 per cent is the upwardly mobile middle class. UDAN scheme is an initiative in this regard.

The civil aviation industry in India has emerged as one of the fastest growing industries in the country during the last three years. With a 19 per cent growth in domestic passenger traffic from about 6.1 crore in 2014 to 10 crore in 2016-17, India is now the third largest aviation market in the world, with the promise to grow even further. What is most impressive about this growth is its inclusive nature defined by the Regional Connectivity Scheme –UDAN, that has made air travel possible for even the common man in remote areas.

Relations between India and Pakistan have remained less than normal ever since the partition of the country in 1947. The two countries have fought wars in 1948, 1965, 1971 and later there was Kargil in 1999. The war of terror against India from across the border continues unabated. Sporadic efforts have been made towards normalization of relations but most of the time it has been a case of back to square one.

Relations with Pakistan were at their lowest ebb when the new Government took charge in May 2014. The invitation to Heads of State/Government of SAARC countries, including Pakistan, to attend PM Modi’s swearing-in ceremony in May 2014 opened up an opportunity for breaking the ice; after initial hesitation, Prime Minister Nawaz Sharrif of Pakistan did come for the event and the two sides agreed to resume the dialogue. Since then the dialogue process has been in ‘now-on-now-off’ mode.

On 1 April, 1950, India became the first non-socialist bloc country to establish diplomatic relations with the People’s Republic of China. Prime Minister Nehru visited China in October 1954. While, the India-China border conflict in 1962 was a serious setback to ties, Prime Minister Rajiv Gandhi’s landmark visit in 1988 began a phase of improvement in bilateral relations. In 1993, the signing of an Agreement on the Maintenance of Peace and Tranquility along the Line of Actual Control (LAC) on the India-China Border Areas during Prime Minister Narasimha Rao’s visit reflected the growing stability and substance in bilateral ties.

India was the first country to recognize Bangladesh as a separate and independent state and established diplomatic relations with the country immediately after its independence in December 1971. India’s links with Bangladesh are civilisational, cultural, social and economic. There is much that unites the two countries - a shared history and common heritage, linguistic and cultural ties, passion for music, literature and the arts. This commonality is reflected in our multi-dimensional and expanding relations. In the last more than four decades, the two countries have continued to consolidate their relations and have built a comprehensive institutional framework to promote bilateral cooperation in all areas.

India’s 4,096 Km long border with Bangladesh is the longest and accounts for nearly 27 per cent of the total land border. As many as five Indian states share the border with Bangladesh-West Bengal, Assam, Meghalaya, Tripura and Mizoram.

India and Afghanistan have a strong relationship based on historical and cultural links. The relationship is not limited to the governments in New Delhi and Kabul, but has its foundations in the historical contacts and exchanges between the people. In recent past, India-Afghanistan relations have been further strengthened by the Strategic Partnership Agreement, which was signed between the two countries in October 2011.

As close neighbours, India and Nepal share a unique relationship of friendship and cooperation characterized by open borders and deep-rooted people-to-people contacts. There has been a long tradition of free movement of people across the borders sharing family ties and culture. Nepal shares a border of over 1850 kms in the east, south and west with five Indian States – Sikkim, West Bengal, Bihar, Uttar Pradesh and Uttarakhand.

The India-Nepal Treaty of Peace and Friendship of 1950 forms the bedrock of the special relations that exist between India and Nepal. Under the provisions of this Treaty, the Nepali citizens have enjoyed certain advantages in India, availing facilities and opportunities at par with Indian citizens. Nearly 6 million Nepali citizens live and work in India.

The relationship between India and Sri Lanka is more than 2,500 years old. Both countries have a legacy of intellectual, cultural, religious and linguistic interaction. In recent years, the relationship has been marked by close contacts at all levels. Trade and investment have grown and there is cooperation in the fields of development, education, culture and defence. Both countries share a broad understanding on major issues of international interest.

In recent years, significant progress in implementation of developmental assistance projects for Internally Displaced Persons (IDPs) and disadvantaged sections of the population in Sri Lanka has helped further cement the bonds of friendship between the two countries.

The nearly three-decade long armed conflict between Sri Lankan forces and the LTTE came to an end in May 2009. During the course of the conflict, India supported the right of the Government of Sri Lanka to act against terrorist forces. At the same time, it conveyed its deep concern at the plight of the mostly Tamil civilian population, emphasizing that their rights and welfare should not get enmeshed in hostilities against the LTTE.

The need for national reconciliation through a political settlement of the ethnic issue has been reiterated by India at the highest levels. India’s consistent position is in favour of a negotiated political settlement, which is acceptable to all communities within the framework of a united Sri Lanka and which is consistent with democracy, pluralism and respect for human rights.

Diplomatic relations between India and Bhutan were established in 1968 with the establishment of a special office of India in Thimphu. Before this, India’s relations with Bhutan were looked after by its Political Officer in Sikkim. The basic framework of India- Bhutan bilateral relations was the Treaty of Friendship and Cooperation signed in 1949 between the two countries, which was revised in February 2007. The India-Bhutan Friendship Treaty not only reflects the contemporary nature of our relationship but also lays the foundation for their future development in the 21st century. The Golden Jubilee of the establishment of formal diplomatic relations between India and Bhutan is being celebrated in the year 2018.

India shares a long land border of over 1600 Km with Myanmar as well as a maritime boundary in the Bay of Bengal. Four north-eastern states viz. Arunachal Pradesh, Nagaland, Manipur and Mizoram share boundary with Myanmar. These geo-strategic realities encompass our broader interests in the Indian Ocean region.

Both countries share a heritage of religious, linguistic and ethnic ties. Further, Myanmar is the only ASEAN country adjoining India and, therefore, our gateway to South East Asia with which we are seeking greater economic integration through India’s ‘Look East’ and now ‘Act East’ Policy. Business opportunities that emerge from a surging economy in Myanmar also provide new vistas for engagement.

Building on our civilizational relationship, since the 1990s India adopted a policy of working on improved Government-to-Government relations. The landslide victory by Aung San Suu Kyi-led National League for Democracy (NLD) in November 2015 general elections and the formation of NLD government has provided opportunities to strengthen the engagement building on our previous efforts.

The concept of national security is unavoidably linked to what is perceived to be the national interest of a country. Protection of India and Indian interests also implies being an active participant in the global community of states. This necessitates shaping and reinforcing the rules, norms and institutions that would be the foundation of peace, security and prosperity in the coming decades.

India today is in the fortunate position of facing no existential threat to its security. In that respect India is better placed today than it was in the past. It also now has increased capacity to deal with external challenges to her security. But this cannot obscure the fact that the international environment in which India makes its foreign policy and national security decisions has worsened recently.

Cyberspace as an independent theatre of war is about attacks that compromise the capability to use these facilities: they cannot be prevented by the security services in isolation. The defence of cyberspace necessarily involves the forging of effective partnerships between the public organisations charged with ensuring the security of cyberspace and those who manage the use of this space by myriad users like government departments, banks, infrastructure, manufacturing and service enterprises and individual citizens. The defence of cyberspace has a special feature. The national territory or space that is being defended by the land, sea and air forces is well defined. Outer space and cyberspace are different. They are inherently international even from the perspective of national interest.

India is rapidly gaining importance in the global stage. As its economic condition becomes stronger, its influence in international affairs also becomes stronger. Now the question arises what threat will arise in the future of this rise in power? With an unstable Pakistan on the one hand, and a growing China on the other, it seems natural to focus on the external security threats as the greatest risk to future success.

Hence, protecting the nation from the external threat is the duty of the defence force which constitutes of Army, Navy and Air force. Combined, the total armed forces of India are the world’s second largest defence force.

The Supreme Command of the Armed Forces vests in the President of India. The responsibility for national defence, however, rests with the Cabinet. The Defence Minister is responsible to the Parliament for all matters concerning defence of the country. Administrative and operational control of the armed forces is exercised by the Ministry of Defence and three Service Headquarters. It also conducts rescue and humanitarian operations during calamities and disturbances, and has frequently been called upon to maintain the internal security of the country.

Social media is a series of websites and applications designed to allow people to share content quickly, efficiently and in real-time. Most people today define social media as apps on their smartphone or tablet, but the truth is, this communication tool started with computers.The ability to share photos, opinions, events, etc. in real-time has transformed the way we do life and it is also transforming the way we do business.